Analysis by an industry leader has examined how the type of borrower affects the likelihood of a mortgage default

The mortgage industry has taken a more conciliatory approach to the RBA's decision to leave rates untouched yesterday, labelling it a testament to economic stability.

In its decision to leave the official cash rate on the hold, the Reserve Bank indicated it had yet to see conditions "weaken materially", with mortgage rates lower than their medium-term average and growth expected to be close to trend. Rather than lamenting the rate hold, Loan Market has called the decision a sign of economic stability.

"While a rate cut would help certain sectors, the overall performance of the economy is within targeted areas, including employment and inflation," a company spokesperson said.

Loan Market said much of the consumer pessimism surrounding the Eurozone debt crisis had eased, though the crisis remained unresolved.

Mortgage Choice spokesperson Belinda Williamson predicted consumer sentiment would see a boost from the decision, but warned that bank lending rates could still move independently of the RBA.

"[The] decision by the Reserve Bank to keep the cash rate on hold is likely to foster a greater sense of confidence in the domestic economy. However, if last month’s interest rate movements are anything to go by, the idea of steady rates may be short-lived," she said.

In light of this, 1300 Home Loan chief executive John Kolenda predicted that variable rates were "approaching their low point", and that fixed rates could also be on the way back up. He urged borrowers to consider locking in their rates.

"It seems unlikely that the RBA is going to drop rates any time soon and even if they did, it is hard to imagine the drop being anything more than 0.5%, if that. The banks are, of course, unlikely to match it anyway," Kolenda said.